EOG Resources (EOG) Q2 Results - August 7

[dan_s]

EOG Resources Reports Second Quarter 2020 Results
- Generated Positive Net Cash Provided by Operating Activities and Free Cash Flow
- Produced 7% More Crude Oil for 26% Less Capital Expenditures than Forecast
- Per-Unit Cash Operating Costs Below Targets
- Discovered 500 Bcf Net Natural Gas Resource Potential in Trinidad
- Increased 2020 Well Cost Savings Target to 12% from 8%, Supporting Improved Outlook for Capital Efficiency

EOG Resources, Inc. (EOG) reported a second quarter 2020 net loss of $909 million, or $1.57 per share, compared with second quarter 2019 net income of $848 million, or $1.46 per share.
Adjusted non-GAAP net loss for the second quarter 2020 was $131 million, or $0.23 per share, < This compares to my forecast of a $85 million net loss compared with adjusted non-GAAP net income of $762 million, or $1.31 per share, for the same prior year period.

EOG shut in a lot of production during Q2, electing to keep it in the ground until commodity prices improved. < This is a very smart move and only possible because EOG has a SUPER STRONG balance sheet.

“EOG generated positive free cash flow in the second quarter, made possible by our ability to
quickly reduce activity and cut operating costs in all of our operating areas in response to
historically low oil prices,” said William R. “Bill” Thomas, Chairman and Chief Executive Officer.
“This is a testament to EOG’s unique culture and the flexibility provided by a decentralized
organizational structure. In addition, our focus on safety, innovation, technical advancements
and continuous improvement has not wavered. Our talented employees quickly and safely
adapted to these volatile conditions, and I want to thank them for their dedication and
commitment to EOG.

“Going forward, we will remain flexible and ready to respond to changes in market conditions
with the goal of maximizing long-term shareholder value. Our priorities are unchanged:
generate high returns on any capital invested and generate free cash flow to fund the dividend
and protect our strong balance sheet. The sustainable improvements we are making across the
company will support improved capital efficiency in the future, enabling EOG to maintain
production at lower oil prices. We are confident EOG will emerge from the downturn an even
better company.”

I will update my forecast/valuation model for EOG on Saturday.